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By Kwan Man Bun (auth.)

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16 Beyond Market and Hierarchy be overturned. He and his foreign staff needed more authority than that granted explicitly by the loan agreement. With the support of the groups consortium and the legations, he successfully demanded the promulgation of more detailed regulations governing the workings of the chief and district inspectorates. The foreign chief inspector was equal in authority to the Chinese chief inspector and, as adviser to the Central Salt Administration, his expanded duties and authority is defined as follows:33 Before any reorganization is effected of the existing system of salt administration and before any contract is concluded or any orders of importance are issued regarding the salt revenue and the transportation of salt to different localities for consumption (the official transportation, merchant’s transportation and transportation by the public at large being included) the said adviser shall be consulted by the Head of the Central Salt Administration, and the nature of the decision to be arrived at and of the orders to be issued shall be determined by the Head of the Central Salt Administration in personal consultation with or in correspondence with the said adviser.

2 The Networks The turmoil that modern China underwent shaped Fan Xudong’s quest to save the country through industrialization. A native of Xiangyin, Hunan, he was the second son of a poor rural school teacher. After his father’s death, he lived in a charitable home for chaste widows with his mother before joining his elder brother Yuanlian (1876–1927) at the Hunan School of Current Affairs (Hunan shiwu xuetang) and followed Liang Qichao into exile after the failed Hundred Days Reform in 1898. With financial support from Liang, Xudong attended Okayama Number Six High School (Dairoku ) kōtō and gakkō Kyoto Imperial University.

4 Beginning with company registration, they battled through the bureaucratic maze of Beijing while raising the needed capital. Their goal might be laudable, but the risks and uncertainties did not endear the company in the capital market, especially after Fan and his colleagues decided against guaranteed dividend (guanli) in Jiuda’s public offering. 7 To some business historians and economists, this is, of course, yet another example of what went wrong in modern China’s economy. Bypassing the market through such particularistic ties, if not corruption, it is a recipe for inefficiencies and limited growth, if not failure.

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